The Chairman of BUA Group the parent company of BUA Cement Plc, Abdulsamad Rabiu has related how cement dealers frustrated his company’s plan to sell cement at ₦3,500 per bag last year.
He also blamed the devaluation of the Naira last year and the removal of fuel subsidy as other factors responsible for the company’s inability to achieve the aim.
Naomisophyblog had previously reported that Rabiu promised to crash cement prices from then over N5,000 per bag of 50kg to N3,500.
However, investigation by Naomisophyblog found out that the product was not readily available while the few areas that had the product in stock refused to sell at that price.
Addressing the issue while speaking at the 8th Annual General Meeting of the company on Thursday, Rabiu said cement prices would have dropped to as low as ₦3,500 per bag were it not for large appetites of profiteering dealers.
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“So, a lot of the dealers took advantage of that policy. Rather than pass the low prices to the customers, they were selling at even double the price we sold to them.
“Some were selling at N7,000 and 8,000 per bag. They made a lot of money with a very high margin. I think we had sold more than a million tons at N3,500 before we realised what the dealers were doing.
“And then, because of the issues that Nigeria faced at the time about devaluation of the Naira last year and the removal of fuel subsidy, we could not continue that policy.
“We wanted that price to stay at that level but dealers refused. So, we could not sustain that simply because we did not want to be in a situation where we are subsidising dealers.
“I’m referring to the point when the foreign exchange rate moved from about N600 to maybe N1,800 to the US Dollar. So, it became even more challenging and more difficult for us to actually sustain that price policy.”
By Babajide Okeowo
The post BUA Chair, Rabiu, blames dealers, FX for frustrating plans to crash cement price to ₦3,500 appeared first on Latest Nigeria News | Top Stories from Naomisophyblog.
